Global rejects town’s $11 million buyout offer
by Kathleen Stinson

CAVE CREEK – The Town of Cave Creek recently offered Global Water Resources $11 million for Cave Creek Water Co.

Global Water spokesman Paul Walker said Global turned down the offer, adding the utility is worth “somewhere in the $20‑some million” range.

Cave Creek Water Co. was acquired by Global in March 2005, after the town failed in attempts to purchase the company from its previous owner. The town then filed a condemnation lawsuit against Global Water in an attempt to acquire the privately owned water company through eminent domain–a right of government to take private property for public use.

The suit, currently in the discovery stage, is pending a decision by a Maricopa County Superior Court judge on Global’s motion to dismiss the condemnation action. Global claims Cave Creek violated the state Open Meeting Law by failing to give public notice town council might vote to file the lawsuit when it so acted.

“When the town began its crusade to eliminate all privately owned, state‑regulated water companies, we were told over and over again that the purchase price would be no more than $6 million,” said David Phelps, a Cave Creek resident whose lawsuit challenging town council’s authority to file the condemnation suit is currently under consideration by the state Supreme Court.

In September, the town purchased Desert Hills Water Company for $2.5 million.

The town was prevented from transferring the company’s assets that same month, however, when the Arizona Corporation Commission issued an emergency order to that effect. At that time the commission was holding a hearing to determine whether Desert Hills Water had violated state regulations in connection with its failure to provide adequate service to 200‑plus customers.

“So far, the town has bought one stressed water company without a Central Arizona Project water allocation for $2.5 million and counting,” Phelps said. “And they have made an $11 million offer for the Cave Creek Water Co.”

Repeated calls by The Desert Advocate seeking comment from Cave Creek Town Manager Usama Abujbarah were not returned.

Reach the reporter at kathleen@thedesertadvocate.com.